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June 29, 2010


Hon. Brian Higgins (sent to all members of the WNY Congressional delegation)
U.S. House of Representatives
431 Cannon House Office Bldg.
Washington, D.C. 20515

Dear Congressman Higgins:

On behalf of the 2,500 employer members of the Buffalo Niagara Partnership, I urge your strong support of H.R. 5141, the “Small Business Paperwork Mandate Elimination Act”, now awaiting action in the House Ways and Means Committee. This legislation would repeal Section 9006 of H.R. 3590, the Patient Protection and Affordable Care Act (PPACA), a stealthily included provision, ill-disguised as a mechanism to pay for the new healthcare reform law, which beginning in 2012 would require all businesses to issue a 1099-Misc. for every business-to-business transaction of $600 or more of goods or services.

Businesses are already overburdened with tax paperwork and a multitude of reporting requirements. On average, small businesses spend more than $74 per hour to meet their tax compliance obligations – by far the most expensive paperwork burden the federal government imposes on the business community. Section 9006, in a misguided attempt to raise revenue, will further increase the cost and complexity of complying with the federal tax code.

Close reading of the legislative language reveals that the removal of the corporate exemption in 1099 reporting requirements coupled with the broadening of reportable events to include “goods” will mean millions of pages of paperwork for businesses across the country. From office supplies to airfare, businesses would be mandated to collect reporting information (corporate identity, legal mailing address, and Employer Identification Number) from each and every merchant they do business with – dramatically increasing the scope and scale of data capture and required paperwork to remain IRS compliant. 

Repealing Section 9006 of the new health care law is a crucial element to ensuring that the business community can continue to aid our country in its economic recovery. Given the potential effects of this onerous provision, I encourage you to champion this bill and push for its movement through the House Ways and Means Committee.


Sincerely,

Andrew J. Rudnick

cc.     Congressman Chris Lee
          Senator Charles Schumer
          Senator Kristen Gillibrand